Tax breaks for developers up for discussion as part of Fine Gael solution to housing crisis
Simon Harris: 'The Government has to look at every possible lever that can be pulled.' Photo: Liam McBurney/PA
Tánaiste Simon Harris has floated the possibility of introducing tax breaks for developers in the upcoming budget, saying nothing would be ruled out.
“The Government has to look at every possible lever that can be pulled, including the cost base that people who build homes, including builders, developers face as well,” Mr Harris said at the Fine Gael think-in in Mullingar.
He described a number of decisions made by the Government in recent months, such as reform to rent pressure zones and apartment standards, as “bold”, but added the Government cannot continually change policies within the housing system.
“If we make another decision in the weeks ahead, then that has to be it,” Mr Harris said. He said there will be a requirement for developers to “get on with it”.
“These things will all be teased through at the budget, but I don’t rule anything out.”
Mr Harris said a draft version of the Government’s new housing plan would be delivered either in late September or early October, before final publication in October.
“What Housing for All, whatever the plan ends up getting called, will endeavour to do is look at the role that each department has to play in relation to the delivery of housing supply,” Mr Harris said.
Questioned about the Government’s plans to cut the Vat rate to 9% for the hospitality industry, Mr Harris said the Coalition had “no intention” to reduce the tax rate for the hotel industry and it would only apply to cafes and restaurants.
The Tánaiste said he rejects some figures floated about the possible cost, saying it would cost in the region of €500m to €600m for a full calendar year for the food sector.
“The timing of which you could introduce, could reduce that cost further, so there’s lots to be considered,” Mr Harris said.
Mr Harris said there was “far too much” taken for granted about people who create jobs in Ireland, citing the 225,000 jobs within the hospitality sector.
Enterprise minister Peter Burke said the Government is “committed” to cutting the Vat rate to 9% for the hospitality sector, saying there are “lots of options” on the table for how it may be implemented.
Questioned on if the Government would cut the rate exclusively for small and medium-sized hospitality businesses, Mr Burke declined to speculate.
On childcare, Mr Harris said the Government would be delivering an “action plan for childcare” when asked if there would be moves towards cutting the cost of creche places.
He said it is important to reach the €200 cap throughout the lifetime of the Government, but there is also a requirement to create more places in creches.
“Parents would tell me and tell you that it’s more than just cost. There’s no point reducing the cost if you can’t get a place and in some parts of the country it’s extraordinarily challenging to get a place.”
Mr Harris added the minister for children, Norma Foley, would decide on steps to progress in the upcoming budget.
The Fine Gael leader also mentioned college fees as something he wanted to “make progress” on in the upcoming budget.
In previous budgets, the cost of college fees were reduced on a temporary basis, with no fee cuts being made on a permanent basis.
Fees sparked controversy earlier this year after higher education minister James Lawless signalled there may not be a cut, which he has since rowed back on.
The budget itself is not due to be published until October 7.
The Fine Gael leader pointed out the Government would not be able to deliver everything in it’s first budget, saying it should be viewed as the “first instalment of five”.
He said the budget must begin “outlining the direction of travel”, however, he ruled out further one-off cost-of-living measures.
However, he said this did not mean the Government would not assist with cost of living in the upcoming budget, including moves on tax, education and childcare.
“I can understand why that can cause a pang of anxiety for people when the cost of living is still real. What we want people to know is, yes we’re moving back to regular budgeting – one annual budget.
“But that’s not the same thing as saying you can’t do things in that budget to assist people with the cost of living.”
It is understood that culture minister Patrick O’Donovan is pressing for the Government to maintain and expand the basic income for artists scheme.
The scheme is currently being run on a pilot basis and has been extended until February 2026, meaning a decision on its continuation is likely to be required in the upcoming budget.
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